Waukesha DA looks into hotel controversy

Subcontractors say they are owed money after helping with Radisson Hotel project

UPDATED 10:51 PM CDT Jun 14, 2012

The Waukesha County district attorney said he is meeting with village leaders in Menomonee Falls on Friday about the new Radisson Hotel.

Subcontractors who worked on the project requested the meeting after complaining they haven't been paid for all of their work.

"I have to admit, I think it looks great. I think every contractor kicked in and did a beautiful job," said Barry Bloom, general manager for Assured Electric.

Bloom is proud to see the Radisson Hotel in Menomonee Falls lit up and open for business, but he wants to know why the village hasn't paid his company the last $70,000 for completing the electrical work.

"It seems as though they made a bad deal with a bad group of investors, and now they're looking to stem their losses by not finishing paying the contractors who did the work," said Bloom.

The rehab of the Radisson was a $17.6 million project, part of the Main Street redevelopment.

Before the job was done, the general contractor was out.

"When the general contractor went out of business, we were dealing directly with the village of Menomonee Falls. It was their money," Bloom said.

So, the city acted as lender.

But, published reports outlined problems with the owners group.One investor filed for bankruptcy, and another was involved in a civil suit.

The hotel went into a receivership, and the remaining $1.2 million of the project is in escrow.

Bloom said all the work is done.

The hotel has been open a year.

He's banded together with a dozen other sub-contractors.

They believe the total owed is between $600,000 and $700,000.

The village administrator said he can't comment on much because of pending litigation.

The village is trying to get the hotel foreclosed on because of significant financial default on the part of the owners group.

Bloom said the village will no longer talk to the subcontractors.

They claim that not being paid could make or break them.

"We're hoping they understand they're putting small businesses like ourselves at risk here," said Bloom.

Waukesha County District Attorney Brad Schimel told 12 News his meeting with village leaders is simply to ensure the money is still in the escrow account, and that he doesn't suspect any criminal activity.